JAKARTA (TheInsiderStories) - Unit of private equity firm PT Saratoga Capital, PT Tri Wahana Universal (TWU) has expressed its interest to take part in the auction of mini refinery projects in seven clusters offered by the government. President director of TWU Rudi Tavinos, said there are provinces and regencies with potentials to build mini refineries with a production scale of less than 20,000 barrels per day (bpd).
Directorate General for Oil & Gas of Energy Minister I Gusti Nyoman Wiratmaja Puja, said the government will offer mini refinery projects in seven clusters that have been set in October or November 2016. He expects the the procedures, scheme and other issues will be finalized before the end of the year, Bisnis Indonesia Reported.
The Ministerial Decree No.22/2016 on the Development of Small-scale Oil Refinery was issued to optimize the sales-ready production or lifting of crude oil and condensate. For cluster-type refineries, the COW contractors in the nearest location must commit to supply crude oil.
If a particular cluster is not attracting bidders, the government can give a special assignment to state energy company Pertamina. However, if there are business entities interested in the cluster, the government will tender-out the project.
TWU already operated two small-scaled oil refineries in Bojonegoro, East Java with capacity of 12,000 bpd and 6,000 bpd. The refineries received oil from Banyu Urip field, which is operated by ExxonMobil Cepu Limited (EMCL).
Rudy Tavinos said that his company plans to build 10 new mini oil refineries with capacity of 10,000 bpd in Sumatera and Kalimantan. He said the company will seek funding source to develop the 10 mini refineries, which is estimated to cost US$1.2 billion.
A number of private companies and local governments have revealed their plan to build mini refineries. They include Bojonegoro Regency government through PT Bojonegoro Bangun Sarana (BBS). The company teamed up with PT Tierra Energi Perkasa to build a mini oil refinery with production capacity of 10,000 barrels per day.
Apart from TWU, a private company North Sumatera-based PT Indo Kilang Prima is also developing mini oil refinery with capacity of approximately 6,000 bpd and a total investment of US$54 million. The company however encountered a problem of inadequate crude oil supply.
This refinery will produce a high-speed diesel, marine fuel oil, kerosene, and naphtha, with total capacity of 2×3000 barrels per day (bpd). (*)